Ronald Cathcart
Ronald J. Cathcart | |
|---|---|
| Born | 1952 Montreal, Quebec, Canada |
| Occupation(s) | Banking executive, financial regulator |
| Years active | 1982–present |
| Known for | Managing Director and Risk Practice lead at Promontory Financial Group; former Chief Enterprise Risk Officer at Washington Mutual; former Head of Enterprise Risk Supervision at the Federal Reserve Bank of New York |
Ronald J. Cathcart (born 1952) is a banking executive and financial regulator with Canadian origins who now holds American citizenship. Presently, he is the Managing Director and leads the Risk Practice at Promontory Financial Group.
Cathcart is a member of the U.S. Risk Committee on the board of directors for the French corporate investment bank Natixis. He also formerly represented the United States within the Policy Development Group of the Basel Committee on Banking Supervision.
His previous senior roles in risk management include serving as Head of Enterprise Risk Supervision at the Federal Reserve Bank of New York and as Chief Enterprise Risk Officer at Washington Mutual. Additionally, Cathcart has held executive risk positions at prominent North American financial institutions such as the Canadian Imperial Bank of Commerce, Bank One, and the Royal Bank of Canada.
During his tenure at Washington Mutual, Cathcart was the top risk officer prior to the onset of the 2008 financial crisis. He was notably proactive in advocating for reduced sub-prime loan origination and more stringent underwriting standards amid worsening market conditions. Early in 2008, Chairman and CEO Kerry Killinger dismissed him after Cathcart raised alarms to both the board and regulatory bodies about inadequate controls and escalating losses. Subsequently, Cathcart provided sworn testimony before a US Senate Subcommittee investigating the crisis’s origins and impacts.
Early life and education
Born in Montreal, Quebec, Cathcart was raised in the Westmount area. He is one of three siblings born to Thomas and Margaret (née Thomson) Cathcart, who are of Scottish heritage.
Cathcart attended prep school at Bishop's College School located in Sherbrooke, Quebec, before completing his A-Levels in English and Physics at St Bees School in Cumbria, England. He graduated in 1974 with an AB degree in English from Dartmouth College, where he participated in The Dartmouth Aires. Later, he earned an MBA from the Ivey Business School at Western University in London, Ontario.
Early career
Cathcart launched his banking profession in 1982 with the Royal Bank of Canada, gaining experience across Toronto, Vancouver, and Europe. After spending 17 years managing risk at RBC, he relocated to the United States to join Jamie Dimon as Executive Vice President and Chief Risk Officer for Retail at Bank One based in Chicago.
In 2002, he took on the role of Executive Vice President for Retail Risk Management at CIBC, where he was responsible for overseeing a consumer-lending portfolio valued at $120 billion.
Transition to Washington Mutual
In December 2005, Cathcart assumed the position of Chief Enterprise Risk Officer at Washington Mutual, reporting directly to CEO Kerry Killinger. Upon arrival, he encountered a risk management division disconnected from business units and struggling with effectiveness. The bank’s "Double-Double" reporting framework complicated matters by requiring business unit Chief Risk Officers to report simultaneously to both Enterprise Risk Management and their respective business leaders, thereby subordinating risk oversight to growth objectives.
Cathcart identified underreported risks within operations, including problems linked to Long Beach, a sub-prime lending subsidiary. As market conditions deteriorated throughout 2006–2007, he implemented tighter standards and escalated risk concerns to senior executives. Despite these efforts, by late 2007 he was excluded from board meetings. In early 2008, he uncovered that Killinger had submitted outdated loss data to regulators; Cathcart independently corrected this information, which further strained their working relationship.
By February 2008, Cathcart informed a board member that senior leadership was sidelining him and obstructing his ability to oversee risk properly. His employment was terminated by Killinger in April 2008. Subsequently, Killinger was removed as chairman two months later and resigned as CEO in September 2008. Following Lehman Brothers’ collapse, Washington Mutual suffered a bank run that led to its seizure by the Office of Thrift Supervision and eventual acquisition by JPMorgan Chase.
After departing Washington Mutual, Cathcart founded Columbia Capital Consulting Group, specializing in real estate consulting alongside risk management advisory services within the United States.
In April 2010, Cathcart testified before the United States Senate Permanent Subcommittee on Investigations concerning Washington Mutual’s failure.
Profession in Financial Oversight
In January 2012, Cathcart assumed the role of Head of Credit at the Federal Reserve Bank of New York, where he was responsible for evaluating credit risks associated with supervised entities. The following year, he was appointed as the United States delegate to the Policy Development Group within the Basel Committee on Banking Supervision, playing a part in shaping the Basel III regulatory standards.
By March 2014, Cathcart advanced to become the Head of Enterprise Risk Supervision, overseeing risk management for systemically critical organizations identified by the Financial Stability Oversight Council, as well as large international financial firms and prominent regional banks.
In 2017, he departed from the New York Fed to take charge of the Risk Management and Regulatory division at Promontory Financial Group.
See also
- 2008 financial crisis
- Basel Committee on Banking Supervision
- Federal Reserve Bank of New York
- Washington Mutual
Further reading
- Levin, Carl. Wall Street and the Financial Crisis: Anatomy of a Financial Collapse. Washington, DC: US Senate Permanent Subcommittee on Investigations, 2011.
- Grind, Kirsten. The Lost Bank: The Story of Washington Mutual - The Biggest Bank Failure in American History. New York: Simon & Schuster, 2013.
External links
- Testimony before the US Senate Permanent Subcommittee on Investigations (April 13, 2010)
- Interview for the Duke University Predatory Lending Oral History Project